Building Better Bankers

ABA Introduction to Agricultural Lending 2/25/19

The Introduction to Agricultural Lending course has been designed to provide students with a basic overview of the agricultural lending function. Updated to reflect the current challenges facing agricultural lenders, this course will help students have a fundamental understanding of the role of agriculture and agricultural lending in the financial services industry.

This course was developed in conjunction with the Schools of Banking, Inc., a jointly-owned subsidiary of the Kansas and Nebraska Bankers Associations.

Learning Objectives

Gain an understanding of the impact of the Farm Financial Standards Council recommendations on agriculture lending, including recommended key financial statements

Understand how to calculate deferred taxes, and the impact of such taxes on agriculture financial analysis and lender decisions

Understand the differences between cash and accrual income statements, and begin developing a working knowledge of accrual income statements and their place in proper financial analysis and lender decision making

Understand the role of cash flow analysis in in making agricultural lending decisions, and begin developing a working knowledge of the “Sweet Sixteen” ratios, specifically: Repayment, Liquidity and Solvency Analysis

Develop an appreciation for the purpose of loan policy, including an overview of loan structure and its relationship to problem loans as well as problem loan workout.